SEOUL, Jan. 23 (Korea Bizwire) — KB Kookmin Bank, a major lender in South Korea, said Wednesday that it has reached a tentative agreement with labor union workers on their wage system and other labor issues.
The bank said the management and the union decided to accept an arbitration proposal prepared by the National Labor Relations Commission. The agreement will be put to a vote by unionized workers on Friday and will be signed officially after getting approval.
The settlement comes two days after the union of KB Kookmin Bank decided to scrap its plan to launch a second strike later this month. The union already staged its first general strike in 19 years on Jan. 8.
The management and the union have differed over the so-called pay band system that limits wage increases in case a worker fails to be promoted during a certain period of time. The union called for the abolishment of the system, which has been in place for new employees since 2014, while the management wanted to expand its scope.
For this matter, the two sides agreed to form a task force and establish a revised wage system in the next five years. If it doesn’t come up with satisfactory measures in that time period, the two sides will ease wage increase restrictions in the pay band system for workers recruited in 2014 or later.
For the wage peak system in which employees get reduced salaries for several years right before retirement, the two sides agreed to apply such a system a month after workers turn 56 years old. If managerial-level workers enter the wage peak system, the company will allow them to take education programs at their home for six months.
Other deals include switching the status of certain part-time positioned workers and establishing computer shutdown rules to guarantee a one-hour lunch time for workers.
KB Kookmin Bank is the country’s No. 1 commercial lender in terms of profits. As of the third quarter of last year, it had logged 2.08 trillion won (US$1.86 billion) in accumulated net profits for the year.